The 2010 HNS Convention: Closing a Major Gap in Maritime Liability and Compensation

Introduction

For decades, the international maritime liability framework has included established liability and compensation arrangements addressing oil pollution, bunker pollution and wreck removal. One significant gap, however, has remained: damage arising from incidents involving hazardous and noxious substances carried by sea. That gap is now set to close.

On 29 November 2027, the International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea, 1996, as amended by the 2010 Protocol, commonly known as the 2010 HNS Convention, will enter into force. It will introduce the first dedicated international liability and compensation regime for damage arising in connection with the carriage of hazardous and noxious substances (HNS) by sea.

Until now, damage arising from hazardous cargo incidents has often been addressed through national laws, contractual arrangements and general maritime liability regimes. The Convention introduces a more structured and uniform framework for qualifying claims, and represents a significant step towards a more complete international liability and compensation framework.

Why now?

The Convention’s entry into force follows the fulfilment of all treaty conditions in May 2026, triggering an 18‑month implementation period before it enters into force on 29 November 2027. This development closes a long-recognised gap in the international maritime liability framework and comes at a time when increasing volumes of chemicals, liquefied gases and substances also used as alternative fuels are being transported by sea. 

 

Key takeaway

From 29 November 2027, the HNS Convention will provide a dedicated international framework for qualifying damage caused by HNS carried as cargo by sea. It combines strict shipowner liability and compulsory financial security with supplementary compensation through the HNS Fund.

The Convention does not create new categories of hazardous cargo. Rather, it establishes a dedicated liability and compensation framework for cargoes already transported under existing IMO conventions and codes.

 

Why does it matter?

Chemicals, liquefied gases and other hazardous substances are integral to global trade, making the absence of a dedicated international compensation framework increasingly significant. The Convention’s significance lies not in changing how these cargoes move by sea, but in reshaping the international compensation framework available when incidents involving them occur.

Unlike regimes focused principally on pollution, the HNS Convention also responds to consequences arising from the hazardous or noxious nature of the cargo itself. Depending on the circumstances, qualifying claims may include loss of life or personal injury, property damage outside the ship, contamination of the environment, economic loss resulting from environmental impairment, and the costs of reasonable preventive measures. The regime therefore extends to risks such as fire, explosion and toxic release, as well as pollution.

 

What cargoes are affected?

The Convention applies to a broad range of HNS defined by reference to IMO conventions and codes. These include:

• certain oils and bulk chemicals;
• liquefied gases;
• packaged dangerous goods; and
• solid bulk materials possessing specified chemical hazards.

Whether a particular cargo qualifies as HNS will depend on the Convention’s definition and the relevant IMO instrument or code to which it refers. The Convention applies to HNS carried as cargo. A substance such as LNG, LPG, methanol or ammonia may therefore fall within the regime when transported as cargo but not merely because it is being used as the carrying ship’s own fuel.

Importantly, the Convention is not confined to cargoes carried aboard chemical tankers or gas carriers. Depending on the substance involved, it may also apply to hazardous chemicals carried in tank containers, portable tanks and other packaged forms aboard containerships. Its implications therefore extend beyond traditional tanker trades and into containerised and intermodal supply chains.

 

Who may be affected?

The Convention has implications across the maritime and logistics chain, including for shipowners and charterers, cargo producers and traders, shippers and receivers, and the freight forwarding, tank container, terminal and logistics sectors.

For shipowners involved in HNS trades, the Convention introduces compulsory insurance and certification requirements. Receivers of qualifying bulk HNS in States Parties should determine whether reporting and HNS Fund contribution requirements apply to them. Packaged HNS is covered by the compensation regime but is not contributing cargo under the 2010 Protocol.  

Shippers, charterers and logistics providers should assess the implications for cargo classification, documentation and contractual risk allocation. The Convention does not determine the contractual allocation of risk between commercial parties. Existing contractual terms and applicable law will therefore remain important, particularly in relation to cargo information, dangerous goods, costs, indemnities and recourse.

The practical impact will turn on the States involved, the place and type of damage, the ship’s flag where relevant, the nature of the trade and the role each party plays in the carriage, receipt or handling of HNS cargo.

 

A familiar framework for shipowners and insurers

For shipowners and insurers, several features of the Convention will be familiar from the international regimes governing tanker oil pollution and bunker pollution.

The HNS Convention generally places strict liability on the registered shipowner, subject to specified Convention defences, requires compulsory insurance or other financial security and gives qualifying claimants a right of direct action against the insurer. P&I insurers are expected to play a central role in supporting compliance, including by providing evidence of financial security for certification purposes.

There is no general minimum tonnage threshold. However, a State Party may exclude ships of 200 GT or less where they carry HNS only in packaged form and operate solely on domestic voyages between ports or facilities in that State. This is an optional exclusion which must be exercised by the relevant State and should not be treated as a general exemption for small ships.

The detailed requirements concerning shipowner liability, limitation, compulsory insurance, insurers’ evidence of financial security (commonly referred to as HNS Blue Cards) and State-issued certificates will be examined in the next article.

 

The two-tier compensation system

At the heart of the Convention is a two-tier compensation framework broadly modelled on the CLC and Fund Convention system.

The first tier consists of the registered shipowner’s strict liability, backed by compulsory insurance or other financial security. The second tier is provided by the HNS Fund, which may make additional compensation available where the first tier is insufficient or otherwise unavailable in circumstances covered by the Convention. Together, the two tiers make aggregate compensation of up to 250 million Special Drawing Rights (SDR) available per incident, inclusive of amounts paid under the first tier.

One important distinction is that packaged HNS is covered by the compensation regime but does not constitute contributing cargo under the 2010 Protocol. HNS Fund contributions are associated with the receipt of qualifying HNS carried in bulk. The detailed reporting, contribution and receiver requirements will be addressed separately in this series.

 

Looking ahead

Although entry into force is scheduled for November 2027, practical preparations should begin well before then. Organisations involved in HNS trades should begin reviewing insurance arrangements, certification routes, contractual provisions, reporting obligations and cargo information procedures as part of their implementation planning.

Accurate cargo information will be particularly important. The Convention relies on the correct identification, classification and declaration of HNS, and contains provisions addressing failures to provide information about the hazardous or noxious nature of cargo. Existing contractual provisions on dangerous goods, cargo information, insurance, costs, indemnities and recourse should therefore be reviewed where relevant.

This article provides a high-level introduction to the Convention. Subsequent articles will examine:

• shipowner liability, limitation, compulsory insurance and certification, including HNS Blue Cards;
• the HNS Fund, and the reporting and contribution obligations applicable to receivers;
• the principal similarities and differences between the HNS Convention and the CLC/IOPC Fund regime;
• jurisdiction, territorial scope and application of the HNS Convention;
• packaged HNS, tank containers and intermodal transport considerations;
• LNG, methanol, ammonia and other alternative fuels: when does the HNS Convention apply?;
• cargo identification, classification and declaration requirements under the IMDG, IBC, IMSBC and IGC Codes;
• contractual risk allocation, charterparties and cargo information obligations;
• shipowner defences and recourse issues arising from inaccurate or incomplete cargo information;
• claims handling, incident response and time limits under the HNS Convention; and
• practical preparations for shipowners, cargo interests, receivers and logistics operators ahead of implementation.

Additional specialist topics may be added as implementation approaches and industry practice develops.

 

Conclusion

The 2010 HNS Convention will close a longstanding gap in the international maritime liability and compensation framework. Although its two-tier structure will be familiar from the CLC and Fund Convention system, its broad cargo and damage scope means that its practical effects will extend across tanker, gas, bulk, container and intermodal trades. 

The immediate priority is for organisations to identify where the Convention intersects with their operations. Shipowners, cargo interests, receivers, insurers and logistics providers should begin reviewing relevant cargoes and trades, the reliability of cargo information, and the insurance, certification, reporting and contractual arrangements that may require attention before 29 November 2027.

Early preparation will be essential. When an HNS incident occurs, the accuracy of cargo information, the effectiveness of contractual arrangements and the preparedness of the parties involved may prove just as important as the compensation framework itself.